Contemporary social networks facilitate user connections with people and the broader world. However, certain platforms misuse user data for unauthorized benefits. Decentralized social networks emerge as a viable solution to this problem. These networks enhance user privacy and security by removing third-party intermediaries.
Farcaster, a decentralized social network protocol, is gaining attention to its potential. Unlike previous blockchain-based social networks that failed to endure, Ethereum co-founder Vitalik Buterin sees substantial promise in Farcaster’s future.
1. Where is Farcaster in the DeSoc landscape?
1.1. The DeSoc waves
According to Galaxy Research, by April 2024, Web3 social networks have amassed 8.7 million users, with approximately 550,000 monthly active users (MAUs). DeSo is the leading platform in user registrations, boasting 3 million users, representing 32% of the total. CyberConnect, Poap, and Phaver follow it in descending order of user base size.
However, currently, Farcaster stands out with 150,000 daily transactions, followed by Lens and Cyber Connect.
Examining present DeSoc projects, they generally experience robust growth initially but see a decline after 3-4 months due to challenges in retaining users. This decline is primarily due to a shortage of high-quality content to keep users engaged, leading to a lack of sustainable funding and revenue.
In contrast to what Buterin criticizes as “financial speculation replacing joy” in the case of Friend.tech, he commends Farcaster and Lens. He believes these platforms are built to endure and remain relevant over time.
1.2. The DeSoc’s main components
According to Coinbase Venture, a Web3 social network project will consist of four main components:
- Hosting: At the base of the stack is the hosting layer, which includes blockchains that run the primitives powering social applications and provide decentralized properties. It also includes decentralized storage protocols for storing certain critical data.
- Social Primitives: These are the essential building blocks representing individuals, their identities (such as actions and assets), and their relationships with others.
- Profile: Wallets function like a passport, allowing users to carry their data to different applications, forming the foundation of their Web3 profile.
- Applications: At the top are the social applications that users interact with. These applications combine blockchains, storage protocols, and social primitives to create engaging user interfaces.
Farcaster boasts two primary products across two layers: Social Primitives, with a developing high-quality ecosystem, and Applications, specifically the Warpcast social networking app.
2. Why is there so much hype around Farcaster?
Farcaster reached an all-time high of 73,700 unique users last week, indicating a significant increase in user activity and highlighting the growing interest and adoption of the platform.
Currently, the platform has 62.58 million posts, with a total of 280,120 users, 3,050 hubs, and 190,540 connected addresses. The network size is 142.83 GB, emphasizing its expanding infrastructure and user base.
Farcaster has generated revenue of 611.03 ETH (equivalent to $1.88 million at an ETH price of $3,078 at the time of writing), showcasing its potential for value creation within its ecosystem.
2.1. Farcaster, its technology, and ecosystem
2.1.1. Storage
Unlike Lens and Cyber, which store data on Filecoin or Arweave, Farcaster utilizes a P2P storage method, maintaining its network of nodes. Currently, user data is stored both on-chain and off-chain to minimize storage costs and enhance scalability, while still maintaining “sufficient decentralization”.
Each Farcaster Hub employs an incremental data structure like a Directed Acyclic Graph (DAG) to manage user content. This storage method enables nodes to quickly access the network and efficiently synchronize the latest data.
The question is, what is “sufficient decentralization”?
2.1.2. Identity
Farcaster utilizes the Ethereum blockchain to establish a decentralized registry. When a new user joins, Farcaster generates an Ethereum wallet address linked to their username. The username itself is an NFT that represents the user’s identity and can be associated with any application on the network. As no entity can revoke an NFT held in your wallet, your identity and the connections you create with it remain secure.
The team refers to this approach as “sufficient decentralization.” By decentralizing key components such as identity, Farcaster ensures that users can always claim and post messages under a username that cannot be revoked. Most other actions occur off-chain, ensuring that the user experience is not hindered by the need to pay gas costs for every action, as mentioned above.
2.1.3. Social graph protocol
When Twitter bans you, you lose all your valuable followers or subscribers. If several clients were using an open Twitter social graph, you could easily switch to a different client, much like changing email providers and retaining your network.
A developer opting to build on the Farcaster protocol can leverage its existing social graph to avoid the initial challenges of establishing a new network. This allows a developer to launch an app similar to TikTok and immediately distribute it to users on the Farcaster protocol. This setup encourages competition and innovation at the application level while preventing any single company from monopolizing the value generated by social networks.
2.1.4. Ecosystem
Farcaster enables developers to create various client applications by accessing the Farcaster Hub network to retrieve and display data to end users in multiple ways. This approach offers users a diverse range of application choices and allows developers to fully exercise their creativity.
Though Farcaster does not have a large number of projects, it features high-quality native applications.
- Warpcast is a social network frequently used by Vitalik to post information and share his views on various societal issues.
- Paragraph, a decentralized platform akin to Substack, successfully secured $1.7M in a Pre Seed funding round with participation from Lemniscap, Binance Labs, FTX Ventures, Sfermion, and others. Notably, this project received a grant from the Base Ecosystem Fund by Coinbase Venture.
- Unlonely is a live streaming platform built on the Base ecosystem, offering various exciting features such as betting and launching its tokens. The development team aims to transform Unlonely into the “Twitch of Web3.”
The prior experience of Farcaster’s team members as CEO and CTO at Coinbase seems to provide the platform with certain advantages, thanks to their high-quality connections.
2.2. Warpcast
Warpcast, developed by the Farcaster team, is the most comprehensive and polished product on Farcaster. Designed similarly to Twitter in terms of interface, users can post messages up to 320 characters, reply, and send encrypted messages to others. In terms of the channels aspect, which are areas dedicated to specific topics, add a Reddit-like element to the network and result in more people asking questions and engaging in discussions.
As of now, Warpcast has attracted over 20,000 users, capturing more than 90% of the market share and significantly contributing to the thriving growth of the Farcaster ecosystem.
2.2.1. Built on Farcaster
Unlike other social media platforms, Warpcast provides exceptional features and advantages for users, including:
- Warpcast prioritizes user privacy by allowing individuals to control their personal information. Users can manage their data, choose their level of anonymity, and determine who can access their content.
- Through Farcaster, Warpcast leverages the immutability of blockchain to enhance trust and authenticity. Data is timestamped and stored on the blockchain, ensuring transparency and enabling users to verify the origin and integrity of the information shared on the platform.
- Warpcast implements a decentralized moderation approach, where the community collectively manages the platform. This reduces the influence of centralized authority and promotes community-driven decision-making.
2.2.2. More than a traditional social media
Vitalik stated, “Farcaster seems to be usable enough as a Twitter alternative for many people.” Consequently, Vitalik has shifted his primary activities to Farcaster instead of X, particularly after his X account was hacked. Warpcast is highly regarded for its user experience due to the following factors:
- Users can select topics of interest to follow, such as Farcaster, OP Stack, or trending events. They can also view their NFTs through the NFT section in their profile.
- Warpcast automatically creates NFT communities. For instance, there will be communities for holders of ENS, Base NFTs, Introduced, and more. It supports content creators in generating NFTs that users can mint and use as memberships to join these communities.
- The platform offers a smooth experience, not requiring transaction signatures or Web3 accounts. Users can log in using their phone number or Google account.
2.2.3. Powered by Farcaster Frames
Warpcast’s true innovation lies in its integration of Farcaster Frames.
Frames have recently brought unprecedented popularity to this network by enabling users to perform multiple functions within a single social media application. These functions include gaming, online shopping, and minting NFTs, all without needing to switch to third-party services.
Similar to social media embeds, Frames display content as static or animated images, but they can additionally facilitate interactive elements through buttons, enabling dynamic user responses.
For the NFT ecosystem in particular, Frames have forged a fresh avenue for showcasing, minting, and engaging with NFTs directly within a social media feed. They provide creators with a new channel to distribute their work and collectors with a new way to discover and interact with NFTs.
Farcaster has significantly contributed to the popularization of Web3 by redistributing value back to the users. However, decentralized social networks like Farcaster remain relatively new and largely untested. Observing how Farcaster and similar platforms evolve and gain acceptance in the coming years will be intriguing.
The information provided in this article is for reference only and should not be taken as investment advice. All investment decisions should be based on thorough research and personal evaluation.